19 April 2014

Buy more online tax free; More about import taxes

You have been waiting for this moment for weeks now, and the blessed day has finally arrived.  You can finally order online without having to shell so much out to the tax man.  Customs have been eliminated on purchases up to $325, and all import taxes have been eliminated for purchases up to $75.


Haven’t we been exempt for a while now?

To much fanfare, the government decided to eliminate customs on personal imports up to 1,200 NIS on 4 December 2011.  To the chagrin of many, this decision required that the Minister of Finance sign the order, which he put off for nearly two months.  However, today (30 January 2012), the order was finally signed.


Taxes on imports
Types of taxes
There are three taxes which are levied on items brought into Israel from abroad:

  1. Customs taxes (מכס)
  2. Purchase tax (מס קניה)
  3. Value added tax (VAT / מע”מ)

Purchase tax (מס קניה)
Purchase tax falls on a variety of items, most of which are as follows:

  • DVDs, videos, CDs, and other electronic entertainment products – 17.4%
  • Auto parts – 22.3%
  • Microphones – 17.4%
  • Answering machines – 17.4%
  • Car and home amplifiers – 17.4%
  • Mixed foods (מזון מעורב) [I'm not exactly sure what that is either] up to 15 kgs
  • Integrated systems (מערכות משולבות) [strike two] – 17.4%
  • Soft drinks – 2.9 NIS / L

Update 23 Feb 2012: A few other categories for purchase tax include:

  • Cellular phones: 15%
  • Food: 0%
  • Clothing: 0%
  • Footwear: 0%

 

Reduced and eliminated import taxes
Customs eliminated on purchases up to $325
Customs taxes have been eliminated on purchases up to $325.

The following three conditions must be met.

  1. The purchase must be imported by mail or alternate mail service.
  2. The purchase must be for personal use.
  3. The transaction price must be not more than 1,200 NIS.  (This includes shipping.)

Purchase and VAT taxes continue without change where applicable.

Tax-free imports raised from $50 to $75
Items sent by mail or alternate mail service which cost $75 or less (including shipping) will have no tax.  Tobacco and alcohol are not included.

 

Calculating taxes on packages above $75
To see how much you will need to pay in taxes above $75, see the Tax Authority’s tax data table.

This should help all those who are looking for deals abroad (like those who want to get glasses or sunglasses on the cheap)!

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Comments

  1. If I buy a laptop on my next trip to the U.S., will I have to declare it when I come back home to Israel? What taxes will I have to pay on it? The prices on laptops are still cheaper in the U.S. than in Israel, but it may not end up being so in the end if I have to pay a bunch of tax when I bring it into Israel.

    • Zivia, this regulation only applies to items that arrive by mail or alternate mail service. Bringing items in directly when returning from a trip is not addressed by this change.

  2. If a package is over 2kg does it get taxed even if it is less than $75? This part is confusing

  3. Great information. I’m working on a collection of sites from which you can order without paying any extra fees (items that meet the under 2kg, under $75 restrictions). You’re welcome to visit it at http://www.hizmanti.com. Currently, the site is only in Hebrew, but on Facebook, I’m posting everything in both English and Hebrew.

  4. @CoriC amazon does ship internationally…just not all products. and you have to pay tax on import http://t.co/PPZ1wejG

  5. Patricia says:

    Purchases were made on-line by me on a UK site. 2 out of my 3 parcels arrived and i was charged Nis70/- for Customs clearance by the Postal Authorities.
    The price i paid for the items were less than the charged price.
    Is there a catch in the new tax free law that i have missed.
    Thanking you in advance for your comments.

    • I am sorry to hear about your experience, Patricia. If the cost of your purchase and shipping is under $75 (and the purchase was not alcohol or tobacco), you should be charged nothing. Are you certain that both the shipping and purchase price total less than $75? If so, I would be very interested to hear why you were charged.

  6. Hi there,
    I was wondering if you can give me advice on this.
    I am looking to order some items from the UK, and the total for the items will be approx $70, but with shipping added on the total price is $105. Will I get charged tax because of the total amount, or is the shipping not included, so it’s below the threshold?
    Also, what’s the minimum that you will get charged VAT when it enters the country? I have ordered various items in the past for about $40 and not been charged anything on entry, so I wasn’t even aware that this was a possibility of being charged.

    Thanks in advance,
    Adam

    • Adam, as stated above, your purchase must be $75 or less including shipping (and not be alcohol or tobacco) to be exempt from taxes. If you spend even a dollar more on product or shipping, you can be hit with purchase tax and VAT as well as handling fees. In some cases, it can be worth it to split up your purchase into two or more orders to keep under the $75 threshold for purchase and shipping. Happy shopping.

  7. I bought a Zagg bluetooth keyboard case online, shipped it here directly ($106) and paid no taxes of any kind on it. Was I just lucky?

  8. Have there been any updates to these restrictions/guidelines since the article was written? I’ve heard several rumors that the limit has been raised to $200. I share this link a LOT with people who ask about receiving packages from abroad…would be great to know that it’s up to date. Thanks!

    • First, thanks very much for sharing, Shara! Second, as far as I understand, the same limits are in effect. I added a link to a table that shows the taxes owed for packages above $75 based on the category of the item. May you be blessed with many sales :)

  9. kym ben ivgi says:

    Great article – very useful. I just wanted to know if I order a few items that are sent separately and each package is less than $75 will be exempt from charges even if the collective value is over $75. Does the tax authority have anyway of connecting purchases or is it just not relevant?

    Thanks,

    Kym

  10. Hello,
    What happens if the purchase IS above $325? Is there a table somewhere with the costs?
    If am looking to buy a stroller which looks to cost more than that…

    Also, is this article still up to date?

    Thanks!

    • Nathan, if the purchase is above $325, then you are subject to all three categories of taxes: customs taxes, purchase tax, and VAT. If you look at the final section, there is a link to a table where you can calculate taxes for such purchases.

  11. Hi iv purchase and engagement ring from Israel for over 1000 us dollars do you know how much tax I have to pay thanks

    • Congratulations, Mark! Since the purchase is above $325 including shipping, then it will be subject to all three categories of taxes: customs taxes, purchase tax, and VAT. If you look at the final section of the article, there is a link to a table where you can calculate taxes for such purchases.

  12. frieda jacobowitz says:

    is it true that footwear is subject to 0% purchase tax?

  13. If you follow the links in the article, that seems to be the case, Frieda. However, note that VAT would still potentially apply to purchases above $75 (including shipping).

  14. frieda jacobowitz says:

    thank you so much, Mr. Matzliach
    i appreciate your prompt reply

Trackbacks

  1. [...] also ensure that the package meets the requirement of being 2 kg or less. Update 30 January 2012: Internet purchases up to $75 are now tax-free, so you can order $65.05 – between 3 and 8 pairs for most people – without worrying [...]

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